FOREST ECONOMICS UNIT 



Throughout the 1969-70 fiscal year, Canada's economic acti- 

 vity was subject to a series of interrelated phenomena. The 

 rapid economic growth which had begun in the first quarter 

 of 1961 had by this period evolved into spiralling inflation. 

 Stringent anti-inflationary actions of the federal government 

 resulted in tight-money conditions and brought about a 

 general decline of the nation's economic activity. The most 

 prevalent indicators of this occurrence were the significant 

 decrease in housing starts and a decline of activity in the 

 construction sector. 



These conditions were to have substantial implications 

 for the forest industry, as indicated by the selling price in- 

 dexes for the following industry components. 



Industry Selling Price Indexes.* 



1969-April 



May 



lune 



luly 



August 



September 



October 



November 



December 



1970-lanuary 



February 



March 



*Source: D.B.S., Prices and Price Indexes. 



Veneer and plywood prices experienced a significant de- 

 cline beginning in the second quarter of 1969 and continu- 

 ing throughout the fiscal year. Lumber and lumber product 

 prices (with the exception of hardwood prices which held 

 relatively constant) dropped in a manner not paralleled by 

 this commodity during the past decade. This event was the 

 main contributing factor to a few temporary mill closures 

 and several slowdowns in the Ontario softwood lumber 

 industry. 



In contrast, pulp and paper prices continued to hold 

 steady. In effect, the demand-supply situation was favour- 



able enough for the pulp and paper industry to again pro- 

 cure a price increase in spite of highly depressed market 

 conditions in other segments of the forest industry. 



The 1969 production of Ontario sawmills indicated that 

 hardwood lumber production increased by three per cent 

 over the previous year, whereas the softwood production 

 advanced less than one per cent irrespective of a signifi- 

 cantly increased production capacity. 



Utilization of sawmill residues for the production of pulp 

 chips continued to increase as the 700,000 bone-dry ton/ 

 year level was surpassed. 



The Unit's activities during the fiscal year were to a signi- 

 ficant degree centred on two major projects; one being the 

 design and execution of a survey to determine rural private 

 landowner characteristics and objectives in southern On- 

 tario; and the other taking the form of a Christmas tree 

 consumer survey in Metropolitan Toronto. 



The rural private landowner survey was conducted 

 through a mail questionnaire during the summer of 1969 in 

 the eight southern administrative districts of the Depart- 

 ment. Five per cent of all landowners, with more than fifty 

 acres of rural property, were included in the sample. More 

 than fifty per cent of the questionnaires were returned, and 

 3,963 of them were analyzed with the assistance of elec- 

 tronic data-processing equipment. 



The purpose of the survey was to determine the general 

 socio-economic characteristics of the rural landowners, 

 their objectives of ownership, and attitudes toward wood- 

 land management. Certain other measures, such as the 

 availability of timber, interest in reforestation, and recrea- 

 tion, were also obtained. 



The survey indicates that 59 per cent of the landowners 

 are farmers; yet three-quarters of the owners grew up pri- 

 marily in rural areas. The implication is that farmers are 

 more often turning to non-farm occupations. 



On the other hand, the non-residents comprise only 14 

 per cent of the total owners of larger rural properties. They, 

 however, did account for 38 per cent of the total land acqui- 

 sitions since 1964 and are gaining in prominence. 



The rural residents and non-resident landowners reflect 

 different ownership objectives. The farmer or rural non- 

 farm landowner still rates timber production for commer- 

 cial or personal consumption as a frequent objective of 

 woodland ownership, whereas many of the non-residents 

 have other goals, such as aesthetics or recreation, in mind. 

 While only five landowners in every twenty expressed an 

 interest in having a portion of their property reforested, 



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